S H Kelkar and Company Limited - Q2FY2023 Operational Update

S H Kelkar and Company Ltd (SHK), the largest Indian origin Fragrance and Flavours Company in India, has announced the business update for Q2 FY 2022-23.

Operational Update:

- Emerging markets witnessed steady demand sentiments during the quarter. The operating environment in the European markets was subdued due to ongoing macroeconomic challenges. Amidst this environment, on a consolidated basis, Q2 FY 22-23 sales stood at Rs. 412 crore (including consolidation of Holland Aromatics & Nutaste's sales: Rs. 36 crore). On a like-to-like basis, excluding acquisitions revenues grew by 7% YoY at constant currency. Emerging market sales stood at Rs. 331 crore, registering organic growth of 12% on a YoY basis

- The Company's profitability was moderately impacted due to higher input costs and adverse currency movement. SHK has been undertaking price hikes to mitigate the impact of inflationary pressures especially witnessed in the European markets

- SHK's participation in the RFP (Request for Proposal) by a large global FMCG MNC is seeing healthy progress with the Company's team of master perfumers working on multiple briefs across various brands and product categories

- The Company is now among the MNC's global supplier base and is seeing a steady stream of leads and remains optimistic on the significant multi-year business potential from this global tender

- On the Balance sheet front, the Company's net debt position stood at ~Rs. 503 crore as on September 30, 2022 as against Rs. 469 crore as on June 30, 2022.

- The increase in debt was on account of outflow for acquiring the second tranche of 19% stake in Holland Aromatics. Following this recent transaction, SHK holds 81% of the company and will acquire the remaining stake in the next fiscal

Note: All figures mentioned in the business update are provisional and unaudited.

Source : Equity Bulls

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SHKelkarandCompany SHK BusinessUpdate OperationalUpdate Q2FY2023